We use search engines every day, such as Google, Yahoo, Baidu and so on. We never paid for them. But they do earn quite a lot of money, especially Google. A great part of it is by charging the retailers for their ranking. That means e-retailers have to pay Google if they want to show up in the first places of the searching results. The more they pay the more front places they will be.
Let’s take an example to see how the ranking works. Here is the process when you are purchasing something online.
- Problem Recognition
Spring break is coming! Have you got a plan already? If your plan is to travel around Amsterdam, there will be several steps you must do before a journey. And one of these is to book a hotel. But you have no idea the locations and expense of all the hotels in Amsterdam? Don’t worry, let’s ask Google.
- Information Search
According to the picture above, if you type ‘hotel Amsterdam’ in Google search, there will be around 224,000,000 results jumping out on your web page. The first few ones look attractive and inexpensive, and it is clearly said that it’s an ‘Ad’. They paid to Google so that they can be shown in the first results to have your attention.
Booking.com is always ranking the first. They have to pay €3, probably, for every click of every visitor. And there are about 1 million hotels registered on Booking.com. It is a high cost but it’s worth it because they earned a considerable profit through their ranking and advertising. Let’s click the first result and see what is going on!
If you click the first one of all the results, you will be linked to a home page of Booking.com. There are beautiful background picture and brief slogans that catch your eyes. All you have to do is to input the check-in and check-out dates of your own schedule and how many people are going to book, almost all the hotel rooms in Amsterdam will appear after one click in a second.
Now you can see the price, the location, the picture and the comment of nearly every hotel in Amsterdam. It’s your choice to evaluate and select a best one. You can also evaluate from different booking websites, such as hotels.com or hotelspecials.com.
The price changes by different room size, discount, location, environment, condition, service, and so on. You can determine which one to buy according to your own demand. There are so many choices provided. I’m sure you have already made your own decision.
After you decide which one to buy, now it’s time for the payment. If you pay online successfully, that’s called a transaction. Google will also charge Booking.com for certain percent of your amount of one transaction. That is another part of how Google earns money and how digital marketing works as well.
Meanwhile, once you have purchased, you have become a customer of Booking.com. They would collect your personal information, such as name, phone number, email address and credit card. Because they don’t want to lose any customer and they will pay a great attention to you in the future. They might try to build your brand loyalty by giving you some discount or displaying advertisements when you are searching a webpage.
- Post Purchase
You might feel it is convenient to book a room on Booking.com. Or you might be pleased with the hotel that you booked after you finished your journey. Then while booking hotels for your next journey, Booking.com might still be your first choice. That means they succeed in attracting one more new costumer. They build your brand loyalty to them step by step. And you will give positive feedback to your friends or family. Finally, they use such ways of advertising to explore a bigger market.